I am optimistic on the hogs today and for that reason I am posting the comments from Dennis this morning
Cash was steady yesterday with the exception of the eastern hog belt, which actually reported some negotiated trade at .75 lower. Why is Smithfield buying hogs on the negotiated market? On yesterdays mixed to higher close volume was reported at 49,200 with open interest up nearly 4,000 cars. In addition, open interest was higher in every hog contract traded. Futures, perhaps, are trying to carve out a low but thats not confirmed until/unless we see a close in June well above 7800, in my opinion. Im searching for something new today and not really finding anything. Im starting to hear better reports regarding the product but clear evidence of such has not surfaced yet. Looking back at the cold storage report, in the face of record large production at the end of 2018 belly frozen stocks were up 6% from a year ago, butts down 30%, hams down 10%, loin stocks were down 3% with total pork stocks up 3%. Thus, starting out the year demand and supply, despite record large production were well balanced. It appears that something has slipped regarding demand since Jan 1st. Certainly the fact that tariffs remain in place and that production has been a bit larger than expected has not helped. Simply put, I view the fundamental news in front of us more likely to be bullish and bearish.